Using Accounts Receivable Financing for Working Cash
Accounts receivable financing, or factoring as it is sometimes called, is an opportunity for companies to streamline their operations and open up cash flow by outsourcing their receivables. The way it works is relatively simple. The lender, or factor, reviews your business’s receivables, and then comes up with a cash advance package based on their amount and the risk involved in collecting.
Financing receivables not only means getting cash now, without waiting for customers to pay on invoices, it also mean streamlining your collection process. When you use a factor, they assume responsibility for collecting on the accounts they use to determine your advance. They then subtract the cash advance and their service fee, passing the rest on to you. The result is money up front to keep you working and an easier approach to managing your accounts.
Benefits of Accounts Receivable Financing
Receivables financing brings with it a host of benefits, including:
- Fast approval and cash advance dispersal—often within 24 hours
- Financing for any kind of business
- No fixed payments
- No loss of equity or addition to your loan portfolio
- Increased access to cash with increased sales and/or volume of business
- Credit insurance on your clients at no cost to you
Explore Financing Receivables
If your company is looking for a way to streamline its cash flow without adding a lot to its overhead, associates at Infinity Commercial Lending are ready to talk about the details of a factoring arrangement with you.